D9 - OB-II Project

8/3/2019 D9 - OB-II Project

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Presented By:

Abhinav Ramji Mishra - 11DM-005

Divyansh Aggarwal - 11IB-020

Nalla Srinath Reddy - 11DM-083

Sahil Gupta - 11IB-069

Simran Preet Kaur - 11FN-105

Sumit Kumar - 11DM-164

ORGANISATION

STRUCTURE

ORGANISATION BEHAVIOR - II

Group 9Section D


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Organisation Structure

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INDEX

Executive Summary ............................................................ 2

Introduction ......................................................................... 3Levels Of Management ................................................................. 3

Traditional Structure Of An Organisation ................................... 4

Organisation Design............................................................ 5

Functional Structure ..................................................................... 5

Divisional Structure ...................................................................... 6

Geographic Structure .................................................................... 6

Matrix Structure ........................................................................... 7

Horizontal Structure ..................................................................... 8Hybrid Structure ......................................................................... 10

Virtual Structure ......................................................................... 10

Objective............................................................................. 11

Methodology ....................................................................... 11

Survey Results ................................................................... 12

Research and Analysis ...................................................... 17

References. ......................................................................... 20


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EXECUTIVE SUMMARY

With the help of inputs from various sources, we analyzed the organisational

structures at different organisations and how they work. A prominent part of

our analysis dealt with understanding the effectiveness of structures in an

organisation and in what way do those organisational structures help the

organisations in improving the productivity of their employees.

We were able to determine the following from the survey:

Which structure is commonly adapted by a particular industry? Which is the most employee-friendly structure? Which is the most preferred structure amongst all? Where are the pitfalls? What are the advantages of a particular structure? What are the disadvantages of a particular structure?


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INTRODUCTION

An organisation can be looked at in several ways. We can think of it as a

system that takes capital and labour as input and gives services or products

as output. Another way of looking at an organisation is to see it as a social

structure in which rules and procedures govern the way that the people

working in the organisation interact.

Any organisation must have some structure and in general this will be

hierarchical.

LEVELSOFMANAGEMENT

At each level of the organisation, employees have different responsibilities

and roles. At the bottom is the operational staff that is responsible forproducing the goods or delivering the services. There is some degree of

management at this level such as foreman or team leader. The next level

consists of middle managers, who are responsible for ensuring that the

operational tasks are carried out. Above the middle managers will be the

senior managers who will be responsible for planning and decision making.

At the very top of the hierarchy is the executive management which will be

responsible for long term planning and setting the overall goals for the

organisation.

The hierarchy may be organized according to function - e.g. Personnel,

Finance, and Marketing or, in a large organisation, it may be based on

divisions where each division replicates the hierarchical structure of other

divisions. The larger an organisation the more structured it is likely to be and

the more clearly defined will be the roles of individuals within the structure.


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TRADITIONALSTRUCTUREOFANORGANISATION

SENIOR

Senior people like Chief Executives, MDs, Marketing Directors, etc.

have to take strategic decisions.

TACTICAL

Middle management (e.g. Area Sales Director, Factory Manager) haveto take tactical decisions.

OPERATIONAL

Operational people (e.g. Foreman, shift leaders, the workforce) have to

take operational decisions.


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ORGANISATIONDESIGN

FUNCTIONALSTRUCTURE

Employees within the functional divisions of an organisation tend to performa specialized set of tasks, for instance the engineering department would be

staffed only with software engineers. This leads to operational efficiencies

within that group. However it could also lead to a lack of communication

between the functional groups within an organisation, making the

organisation slow and inflexible.

As a whole, a functional organisation is best suited as a producer of

standardized goods and services at large volume and low cost. Coordination

and specialization of tasks are centralized in a functional structure, which

makes producing a limited amount of products or services efficient and

predictable. Moreover, efficiencies can further be realized as functional

organisations integrate their activities vertically so that products are sold

and distributed quickly and at low cost. For instance, a small business could

make components used in production of its products instead of buying them.

This benefits the organisation and employees faiths.


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DIVISIONALSTRUCTURE

Also called a "product structure", the divisional structure groups each

organisational function into a division. Each division within a divisional

structure contains all the necessary resources and functions within it.

Divisions can be categorized from different points of view. One might makedistinctions on a geographical basis (a US division and an EU division, for

example) or on product/service basis (different products for different

customers: households or companies). In another example, an automobile

company with a divisional structure might have one division for SUVs,

another division for subcompact cars, and another division for sedans.

Each division may have its own sales, engineering and marketing

departments.

GEOGRAPHIC STRUCTURE

Geographic structure groups employees together based upon specific

geographic location. It clearly defines reporting relationships, decision-

making authority, and the physical location of employees from various

departments. The representatives are grouped from each functional

department into units formed to serve a specific market or region. This is

often used by large companies that operate in many areas throughout the

country or in both the home country and overseas. Geographical units can be


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highly effective if they are located within the regions they serve and employ

workers from the local labor pool.

MATRIXSTRUCTURE

The matrix structure groups employees by both function and product. This

structure can combine the best of both separate structures. A matrix

organisation frequently uses teams of employees to accomplish work, in order

to take advantage of the strengths, as well as make up for the weaknesses, of

functional and decentralized forms. An example would be a company that

produces two products, "product a" and "product b". Using the matrix

structure, this company would organize functions within the company as

follows: "product a" sales department, "product a" customer service


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department, "product a" accounting, "product b" sales department, "product

b" customer service department, "product b" accounting department. Matrix

structure is amongst the purest of organisational structures, a simple lattice

emulating order and regularity demonstrated in nature.

Weak/Functional Matrix: A project manager with only limitedauthority is assigned to oversee the cross- functional aspects of the

project. The functional managers maintain control over their resources

and project areas.

Balanced/Functional Matrix: A project manager is assigned to overseethe project. Power is shared equally between the project manager and

the functional managers. It brings the best aspects of functional and

projective organisations. However, this is the most difficult system to

maintain as the sharing power is delicate proposition.

Strong/Project Matrix: A project manager is primarily responsible forthe project. Functional managers provide technical expertise and

assign resources as needed.

HORIZONTALSTRUCTUREIt is an organisational structure with few or no levels of intervening

management between staff and managers. The idea is that well-trained

workers will be more productive when they are more directly involved in the

decision making process, rather than closely supervised by many layers of

management.


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This structure is generally possible only in smaller organisations or

individual units within larger organisations. When they reach a critical size,

organisations can retain a streamlined structure but cannot keep a

completely flat manager-to-staff relationship without impacting productivity.

Certain financial responsibilities may also require a more conventional

structure. Some theorize that flat organisations become more traditionally

hierarchical when they begin to be geared towards productivity.

This model promotes employee involvement through a decentralized decision-

making process. By elevating the level of responsibility of baseline employees

and eliminating layers of middle management, comments and feedback reach

all personnel involved in decisions more quickly. Expected response to

customer feedback becomes more rapid. Since the interaction between

workers is more frequent, this organisational structure generally depends

upon a much more personal relationship between workers and managers.

Hence the structure can be more time-consuming to build than a traditional

hierarchical model.


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HYBRID STRUCTURE

A hybrid organisational structure is a one in which more than one

organisational design is used. This allows a company more flexibility in

distributing work and assigning job roles. It can be especially beneficial in

small business, where there are fewer employees to manage daily operations.

A hybrid organisational structure creates a shared mission and allows for

employees to work on different projects and in different sectors. This

structure creates a unified team of individuals with a common goal and

different experience and interest levels. Each employee is able to perform

work in the areas he is best suited to, moving from project to project and

reporting to different individuals when necessary. Another benefit to the

hybrid organisational structure is the massive scale that can be reached by

its use.

VIRTUALSTRUCTURE

The virtual organisation exists within a network of alliances, using the

Internet. This means while the core of the organisation can be small but still

the company can operate globally.


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OBJECTIVE

The main objective of the project was to validate that "An organisational

structure affects employee retention in the organisation".

The objectives that were considered in arriving at the solution are :

To understand various organisational-structures Differentiate between various organisational-structures To study advantages and dis-advantages of different types of

organisational structure

METHODOLOGY

To assess different kinds of Organisational Structures and their impacts on

the working behavior of employees, a questionnaire had been floated to know

about kind of Organisation (Manufacturing, IT/ITES, Telecom), kind of

organisation structure like Functional, Divisional, etc. have been included

along with satisfaction levels. Questionnaire is floated over Internet to reach

maximum employees in diverse sectors.


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SURVEY RESULTS

We performed a survey with a sample size of 102 people. These individuals

have been working for at least 5 years. The sample was aware about their

organisation structure. We observed that the majority of individuals weresatisfied with the structure their organisation followed.

There were 15 questions in all where the first 3 were for classification

purposes, and the next 12 were related to the organisation structure and

their preferences. Please find the results of our findings below:


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RESEARCH ANDANALYSIS

We received 102 responses for the survey and we have analysed the following

from it:

Of the total sample, 27% respondents belonged to services sector,followed by 28% from the manufacturing sector.

The respondents were also asked about the present structure of theirorganisation. Maximum respondents are working in functional

structured organisation (29%) followed by matrix structured

organisation (20%).

After these preliminary questions, we asked questions to ascertain thesatisfaction levels with their current organisations structure.

A majority of respondents said that their organisations handledoperations in a cooperative manner.65% respondents said that its easy

for them to approach the top management in their organisation.

Majority (61%) of the respondents said that their organisations valuedtheir opinions.

We asked them whether the organisations had any mission plans andif the organisation was good at fulfilling the mission. Most of the

respondents in the Manufacturing, IT/ITES, Telecom and Services

sectors mentioned that their organisations had a mission plans and

were also good at fulfilling them. A few respondents in the others

category, who were self-employed answered this question negatively.

When enquired about the time taken for information to reach from thetop management, maximum respondents said 1 -2 days.

On the question whether the people liked starting a new day at work,the most number of negative responses were from the IT/ITES sector.

Of all the sectors, the maximum numbers of respondents are workingin the functional structured organisation and are satisfied with it.


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When asked for the most preferred structure they would like to workin, horizontal structured organisation scored the maximum score.

The above graph depicts the time to disseminate information for different

types of structure based on our survey.

The above graph shows that most people prefer the structure that they

currently work in over others.


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Thus, on the basis of the survey, we can say that the IT/ITES sector had the

weakest culture in comparison to the other sectors included in the survey. We

also searched the internet for the latest attrition rate across sectors. IT/ITES

sector had attrition rates of around 25%, compared to the Indian average of

18% (across all sectors).

This validates the fact that a good organisational culture facilitates employee

retention in an organisation.


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REFERENCES

Organisational Theory, Change, and Design [Richard L. Daft] Seventh

Indian Reprint 2011

Welcome to Learn Management2.[ONLINE] Available from:

http://www.learnmanagement2.com/ [Accessed: 26th Nov 2011]

Factors Affecting Organisational Design. [ONLINE] Available from:

http://www.cliffsnotes.com/study_guide/Factors-Affecting-Organisational-

Design.topicArticleId-8944,articleId-8881.html [Accessed: 26th Nov 2011]

Organisational Structure.. [ONLINE] Available from:

http://www.hrmguide.net/hrm/chap4/ch4-links3.htm[Accessed: 26th Nov 2011]

Organisational Structure. [ONLINE] Available

from:http://www.encyclopedia.com/topic/Organisational_structure.aspx[Acces

sed: 8th Dec 2011]

Organisational Structure Types and Design Strategy. [ONLINE]

Available from:http://www.organisationalstructure.net/[Accessed: 8th Dec

2011]

Organisational structure. [ONLINE] Available from:

http://en.wikipedia.org/wiki/Organisational_structure[Accessed: 10th Dec

2011]

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